Admin

From 1984-1986 up through 2010-2012, the US Census Bureau maintained three-year average data on median household incomes by state, as part of its Annual Social and Economic Supplement. To see how even, or uneven, the growth in that median income has been from state to state, I decided to take that first and last data point and compare the changes. Which states progressed the most – and which the least?

The result is this chart ‒ you’ll need click to enlarge, otherwise you won’t see much (and here is the data as PDF). Size of the bubbles represents 2010 population size.

Click to enlarge: Median household income by state then and now

My interest in this data related primarily to the discussions about stagnating middle class wages in the US; over the years I’ve seen the subject come up time and again that especially male, middle or working class individuals, and most especially those working in manufacturing, are hardly or no better off now than they were in the mid- or late 1970s. This US Census Bureau data set about median household incomes doesn’t quite confirm that, but the national growth it does show, in inflation-adjusted dollars, between 1984-1986 and 2010-2012 is hardly impressive: an anemic 6.2% in 26 years. In addition it should probably be kept in mind that the data set only starts out after the depression of the early 1980s and some 5 years of Ronald Reagan’s administration, which coincided with a rapid increase in income inequality.

The list of the states with the lowest median household income in 2010-2012 was not surprising: starting at the bottom, it’s Mississippi, Arkansas, Louisiana, Kentucky, Tennessee and South Carolina. Montana has the lowest median household income outside the South, whereas West Virginia, perhaps surprisingly, is only the ninth-poorest state by this measure.

The comparison with the ranking and proportions 26 years earlier yields some surprises. In no fewer than six states, the median household income was higher then, than it is now. In an additional five states, the median household income in 2010-12 is at most $1000 higher (in 2012 CPI-U-RS adjusted dollars). These near-dozen states include:

Three midwestern states with lots of (former) industry, as you’d expect: Ohio, Michigan and Indiana. Ohio suffered the deepest cuts of the Lower 48, with a median household income that was 7.9% lower in 2010-12 than in 1984-86. Michigan, too, ended up with an actual decrease in median household incomes.

Three states in the southwest: California, Nevada and Arizona. Maybe the influx of Latino immigrants, many of whom now survive on low wages, is dragging the median down? Nevada now has a lower median household income than in the mid-80s.

Two states in the Deep South (Louisiana and South Carolina); as well as Kansas, Alaska, and Hawaii. Alaska was down the most of all states, actually, though even now it still ranks in the top 10.

The states where median wages in 2010-12 were at least $8,000 higher than 26 years earlier include:

In the BosWash corridor, New Hampshire and Maryland. Those two states have ended up with the highest median wages of the country (booming exurbs?). But the largest growth of all the U.S., at +$15,714 and +35.1%, was in Washington DC, which has transformed unrecognizably since Marion Barry’s glory days and the crack epidemic.

North Dakota ‒ location of a remarkable oil boom ‒ has seen the nation’s second largest growth in median household income: +$12,385 or +28.6%. Nearby Wyoming also benefits from its flourishing extractive industries, as well as the growth in tourism. (In comparison, it’s striking that Alaska’s median income is down by so much, considering that it’s another state whose economy is disproportionally dependent on oil, gas and mining.)

Elsewhere in the Upper Midwest, however, South Dakota, Nebraska and Iowa also all saw well above-average growth in median household incomes. I’m grasping for explanations here, but maybe that has involved the tail end of the long process in which small family farms died out (and the farmers’ sons and daughters moved to the city) and were replaced by large-scale, prosperous agro-industrial farms?

Washington state (Microsoft, Boeing, Amazon and/or Starbucks?) … as well as West-Virginia. Which surprised me. West-Virginia had the second-lowest median wages of the nation in ’84-86, ahead of only Mississippi; now it has the ninth-lowest, higher than states like Montana and Tennessee.

The above visualization is the result of generating a bubble chart within Google Spreadsheets, and then processing it in GIMP to add the diagonal line and labels, as well as to pull apart the labels for individual states where the Google chart had superimposed them over each other.

For an automatically generated alternative, I also tried using TableauPublic, and the resulting chart looks a lot more sleek: Median Household Income by State, 1984-196 vs. 2010-2012. It lacks explanatory labeling and a diagonal line to help you orient yourself though. The program is free, but if you’re using it for the first time it takes a bit of figuring out ‒ you’re really going to need the instructions. Once you get a grasp on the basics, though, a chart like this is extremely easy to create.

I found maps a little more complicated to make in TableauPublic, especially compared with using the “geomap” option when creating charts in Google Spreadsheets. But since the Google Geomap won’t show on this blog, I did it anyway. Here are the maps showing the data on median household income by state in 1984-1986, in 2010-2012, and the difference between those two years. I’m afraid Alaska and Hawaii got cut off (another reason to prefer Google Spreadsheets’ geomap, where they are neatly scaled and repositioned to fit into a simple U.S. view), though you should still be able to use the zoom functions to reveal them.

Comparing the maps, it seems to me that the contrast between the BosWash corridor and the surrounding country has grown only more pronounced. You can clearly see the relative decline of the industrial Midwest. The South remains the worst off, as the TableauPublic bubble chart illustrates well too, though the poorest Southern states are also the ones that have caught up with the others the most – with states like Alabama, Tennessee and West-Virginia catching up with the Carolinas and Louisiana. The West remains a bit of a patchwork, meanwhile, with Colorado, Utah and Wyoming, blessed with higher median household incomes, putting some distance between themselves and Montana, Nevada, Arizona and New Mexico.

Have you heard about the bonuses paid to the losers at AIG? OK, that’s a joke because everyone has heard about how “the very employees responsible for running the company into the ground” are making off with millions in tax payer dollars as Senator Mark Warner wrote in a letter to the AIG CEO Edward Liddy. Now I will never receive a seven figure bonus and I can’t figure out why a company would ever agree to pay one, but with that being said, I’m just not on the Bonus Bashing bandwagon yet. It’s not that I think AIG is great. It’s not that I’m especially sympathetic with the downward spiral that the formally high riding AIG folks are on. The real reason that I can’t yet bring myself to go looking for my torch and pitchfork is that we really don’t know squat about these bonuses… and neither do the congressmen building ever higher soap boxes from which to denounce them. What we don’t know so far: who got the bonuses, why they got them, what were the criteria for receiving them. What we do know: $165 million in bounuses were paid and a total of close to $1 billion is slated to be paid to around 4,600 top managers in 2009. So do all our congressmen know what they are talking about?

I heard one congressman saying something to the effect of “how do any of these people deserve performance bonuses when their company is crashing?” Let me say again that I don’t understand million dollar bonuses, but that said, I think it is perfectly reasonable that bad companies can have great employees. Should the top salesman at the local GM dealership give up his bonus because GM is doing poorly? What if GM accepts government money? What if he sells a crappy car? My thought is that if he was working to an incentive plan and he achieved his end of the deal, he should get his check. Many employees receive some portion on their pay as variable compensation. Every employee at the company where I work is on a bonus plan. We don’t get millions, but everyone has the potential to get up to 10% of their annual pay based on performance. For more senior employees the percentage is higher. If I meet my objectives and targets, can the government take that money away? Personally, I don’t consider this a “bonus”, I consider it pay. How about that guy, Douglas Poling, who received the biggest bonus: $6.4 million? Turns out he was reponsible for trying to clean up the mess and his work resulted in AIG recouping big dollars, dollars that we taxpayers don’t have to pay.

We’ve also read about “retention bonuses paid to people who have left the company.” How does that make sense? OK, from far away, I can question the wisdom of offering these plans, but let’s understand that these payments are made after the service term to employees that stayed last year. For whatever reason, AIG offered to make a payment to employees who stayed in 2008. When that period expired, they were entitled to the payment even if they left the company. AIG was not government supported at the time, but was feeling heat. Maybe they felt they needed to keep top performers. I don’t know why they made these offers. You don’t either. I probably wouldn’t have offered such plans, but if I was offered one and accepted it in good faith to stay on a sinking ship, I’d consider my end of the deal complete. Was management pulling a fast one? Let’s go find out, but at least let’s hold our fire until we know the answer.

Rush LImbaugh has been crowned the leader of the Republican Party by the Democrats and to the humor of all, his fellow Republicans have kind of completed coronation. So how should Rush use his new found power? It’s clear that there is a void at the top of the Republican party and Rush has a large bully pulpit, so what should he do? I have an idea for you Rush.

First, recognize that all those who try to speak for the Republican Party on the stimulus all have one thing in common: They are completely unqualified to speak about the economy in general and our current crisis in particular. Not that the Democratic congressmen and senators are any better, because they aren’t. On one side of this crisis, you have Obama’s administration consulting with the best economists money can buy. One the other side, you have … what, a bunch of politicans looking to profit from being in the opposition? People who want Obama to fail? This is not going to work for you.

Once you understand that these people, your subjects, don’t know what they’re talking about, it’s time to take on the administration. Put together your team of reputable economists and present your own plan! I’m sure you can find a group of economists who are not confident about the administration’s plan to sit around a table, put together a comprehensive theory of what is happening and how we can mitigate the crisis and then propose a solution that is different than what the administration has proposed. The economists would probably do it for free just for the press! Armed with a counter proposal, your minions in government would be in a position to ask for changes in the stimulus package instead of futilely cursing the Democrats. This is your chance to lead Rush. What are you going to do with it?

It seems like a new Republican mantra has broken free from the dark corridors where is was previously consigned to furtive whispers: they want Obama to fail. I understand that Obama is pushing for many policies that don’t fit with the Republican party line, but how can you want him to fail? What does an Obama failure look like for the United States? Unemployment over 10%? Numerous failures in the US manufacturing sector? Significant erosion in the soft power of the US, much of which stems from our economic position in the world? Is that what Republicans are hoping for? How can a Republican congressman go back to his or her constituents and defend this position? The governor of South Carolina has gone so far as to say he wants to use S.C.’s share of the stimulus money to pay down South Carolina’s debts instead of trying to create new jobs. Since South Carolina’s unemployment rate is 10.4%, the second highest in the nation, you might think that the governor would decide to create more jobs, but even as the state is furloughing teachers and moving to larger class sizes, Governor Stanford is turning away help for politics.

After President Obama’s address, the latest “rising star” of the Republican Party took the stage to present the party response. Bobby Jindal’s speech has been pretty widely panned with pundits commenting unfavorably on his delivery, diction, stage presence, etc, but in terms of respresenting current Conservative thought, it was right on the money. Skip all the window dressing and look at the meat of his address. Here is what I take away about Conservative views on government, taxes, education, science and defense.

Role of government

Governor Jindal starts with this story:

During Katrina, I visited Sheriff Harry Lee, a Democrat and a good friend of mine. When I walked into his makeshift office, I’d never seen him so angry. He was yelling into the phone: “Well, I’m the Sheriff and if you don’t like it you can come and arrest me!” I asked him: “Sheriff, what’s got you so mad?” He told me that he had put out a call for volunteers to come with their boats to rescue people who were trapped on their rooftops by the floodwaters. The boats were all lined up ready to go, when some bureaucrat showed up and told them they couldn’t go out on the water unless they had proof of insurance and registration. I told him, “Sheriff, that’s ridiculous.” And before I knew it, he was yelling into the phone: “Congressman Jindal is here, and he says you can come and arrest him too!” Harry just told the boaters to ignore the bureaucrats and go start rescuing people.

There is a lesson in this experience: The strength of America is not found in our government. It is found in the compassionate hearts and the enterprising spirit of our citizens.

The point here: Government is an obstacle to be overcome. This particular story is pretty ironic. My father was one of the late sheriff Lee’s deputies in the mid eighties and if there is one thing that is beyond doubt is that Lee was a politician through and through, the most influential politician in Jefferson Parish from the 80’s until his recent death. Jindal praises Lee’s work organizing relief while at the same time implying that government is the problem. The Governor envisions a world where the government is too small to help so that the “compassionate hearts and the enterprising spirit of our citizens” can shine through.

The term chutzpah— a Hebrew term for shameless audacity — is often defined by analogy: it’s like a man who murders his parents and then pleads for leniency because he’s an orphan. Or it might be like a man who complains about the financial irresponsibility of average citizens while being cheered on by a bunch of derivatives traders.

Rick Santelli: "I'm the problem? No, YOU'RE the problem!"

That man was Rick Santelli, a financial affairs commentator for CNBC, member of the Chicago Board of Trade, and a former executive at Drexel Burnham Lambert, a firm driven into bankruptcy in the 1990s due to financially irresponsible trading in junk bonds. Santelli, in what has become an anguished cri de cour for the conservative “what, me worry?” crowd, complained on a recent broadcast that the government stimulus package was “promoting bad behavior” by rewarding home buyers who can’t afford their mortgage payments (or, in Santelli’s words, the “losers”). As Santelli put it:

You know, the new administration’s big on computers and technology– How about this, President and new administration? Why don’t you put up a website to have people vote on the Internet as a referendum to see if we really want to subsidize the losers’ mortgages; or would we like to at least buy cars and buy houses in foreclosure and give them to people that might have a chance to actually prosper down the road, and reward people that could carry the water instead of drink the water?

Again, let me point out: Santelli was saying this on the floor of the Chicago Board of Trade. Certainly, it was possible for him to find a more ironic location from which to deliver this diatribe (one of the trading rooms at Bear Stearns comes to mind), but probably not one more convenient for his daily commute into the Loop.

A Redditor started a Wiki on the stimulus bill. The purpose: to translate its provisions into ordinary language so regular people can understand it, filtering out the legalese. And to sort out exactly how much money is assigned to what and whom.

The initiative got some 870 up votes (and lots of discussion) on Reddit, and it seems like a fair spread of people is now working on the Wiki. I thought it was interesting: both the idea and the resonance it had. Citizenship in action?

Of course, as with every Wiki, the risk of pranks and manipulation looms rather large. But at least, as one commenter notes, it seems like an interesting social experiment. And even just the act of creating it should acquaint a bunch of people with the specifics of the bill, maybe better than many of the Congressmen who had to vote on it hours after the final version was released.

It’s also distinct from a partisan initiative like readthestimulus.org (offline right now), which was sponsored by the Heritage Foundation.

No idea how useful or complete it will become. For one, while the site links to the post-conference version of the bill, it also notes that it is still largely based on the version that was passed by the House on 28 January. Whereas the bill was of course significantly modified since – first by the Senate, which made changes that according to Krugman would have created 600,000 jobs less than the original House bill, and then by the conference, which crafted a compromise between the two bills.

I’d also worry about reinventing the wheel. For example, as noted in the Reddit thread, the CBO already created a table, stretching for a few pages, that summarises the stimulus expenses, year by year, by section of the bill. (Table 2 in the enclosures of this letter from the CBO director to Nancy Pelosi.)

But still I thought it was great. At best it will make for a very neat tool, and at worst it will still, as initiative, be an encouraging sign of the times.

If you were in any suspense about which Republicans voted for the stimulus in the Senate, by the way, now that the previous Senate and House versions have been unified into a final bill, here’s a hint: they were the same ones as last time.

Four days ago, the Senate voted on its own version of the stimulus bil. All of three Republicans voted in favour: Olympia Snowe (ME), Susan Collins (ME) and Arlen Specter (PA). Judd Gregg (R-NH) abstained, and all other Republicans voted Nay, while all the Democrats voted Yea.

Then the bill went into the conference committee, where Senate and House bigwigs hammered out a compromise between the different versions of the bill the two chambers had passed. Yesterday the House passed the new version almost entirely along partisan lines, with not one Republican voting in favour and just seven Democrats voting against (see this post for the details). Which left it to the Senate to confirm the result and pass the new, unified bill as well.

They did so, and the vote was practically identical to last time. The only differences were that Ted Kennedy, battling brain cancer, wasn’t able to come now, and Gregg this time did not abstain but voted against. The result: 60 Yeas and 38 Nays, compared to 61-37 last time.

You may have seen Karl Rove opine in the WSJ that “support for the stimulus bill is falling”, and that “the more Americans learn about the bill, the less they like it.” He is certainly not the only conservative asserting that the bill is impopular.

I’m not in the super-enthusiastic category myself, if obviously for very different reasons than conservatives have for disliking it. Overall I think the bill doesn’t look bad, though my initial enthusiasm has been damped somewhat after reading, for example, Paul Krugman’s very persuasive commentary. It’s probably not enough, and maddeningly worse than it could have been; but it’s still a whole lot better than nothing, and it does have lots of good stuff in it. So far my layman’s take, which is not exactly the most interesting one.

But what does the American population think? Is Karl Rove right? Unsurprisingly, not quite. An overview of the polls that were conducted in the past two and a half weeks, and explicitly asked respondents to express an opinion for or against the bill.

There are two pollsters that have done more than one poll within this timeframe: Gallup and Rasmussen.

Gallup asked: “As you may know, Congress is considering a new economic stimulus package of at least 800 billion dollars. Do you favor or oppose Congress passing this legislation?” All three times it polled the question, it found a majority in favor, and in the last iteration, on the 10th, that majority had grown from 52% to 59%.

Rasmussen asked: “Do you favor or oppose the economic recovery package proposed by Barack Obama and the Congressional Democrats?” It found strikingly different results.

According to Rasmussen, in late January a narrow plurality of 42% was in favour; a week later the roles were reversed, with a plurality of 43% in opposition; and by the 11th a plurality of 44% was in favour again.

Three other pollsters asked a variation of the same question at some point in these last two and a half weeks.

A CBS poll queried respondents: “Would you approve or disapprove of the federal government passing an economic stimulus bill costing more than 800 billion dollars in order to try to help the economy?” They approved by 51% to 39%.

A Pew poll asked respondents: “From what you’ve read and heard, do you think [the economic stimulus plan being proposed by President Obama that may cost about $800 billion] is a good idea or a bad idea?”. It found a narrow majority of 51% saying it was a good idea; 34% thought it was a bad idea.

The vote: 246 in favour; 183 against. Compare: the previous time it was 244 in favour and 188 against.

Just like last time, not a single Republican voted in favour. On their side, the only differences were that:

Last time, Ginny Brown-Waite (VA-5) did not vote; now she voted Nay;

Last time, John Campbell (CA-48) and Chris Lee (NY-26) voted against; now they did not vote.

That’s it.

On the Democratic side of the aisle, 246 Representatives voted in favour; 7 against; 1 “present”; and 1 did not vote. Last time round, 244 voted in favour and 11 against.

These are the Democrats who voted against the stimulus both times:

Bobby Bright – AL 02

Parker Griffith – AL 05

Walt Minnick – ID 01

Collin Peterson – MN 07

Heath Shuler – NC 11

Gene Taylor – MS 04

There were actually three vote-changers who went from supporting the bill to opposing it or abstaining (!):

Peter DeFazio (OR-4)- changed from Yea to Nay

Dan Lipinski (IL-3) – changed from Yea to Present

Jim Clyburn (SC-6) – changed from Yea to Not voting (not sure why – he’s the House Majority Whip. Maybe just couldn’t make it for some reason or other?)

And there were all of five who were persuaded by the changes to the bill and now voted in favour:

Allen Boyd – FL 02

Jim Cooper – TN 05

Brad Ellsworth – IN 08

Paul Kanjorski – PA 11

Frank Kratovil – MD 01

I’m inclined to say, what a waste. All of these compromises in the name of bipartisan change, and all for nought, as the Republican Party remains unified on its course of sabotage. OK, I realise that the compromises were primarily needed for passage in the Senate. Let’s see how many Republicans sign up there. I doubt it will be more than three or four. And considering that their sense of centrism is to take whatever is offered and just slice a vanity (but costly) 10% off it, you could have had a much better bill by going in more aggressively. Instead of giving away the compromises right at the start by building them straight into the first draft. It was a costly lesson Obama learned.

I suggested last night, in a quick first take, that the stimulus bill that came out of the conference committee of Senate and House bigwigs doesn’t look bad. But a quick round-up of the liberal blogs in our blogroll shows mixed reactions, in as far as people have gotten round to responding yet.

Steve Benen at the Washington Monthly quotes the Post saying that the final version of the bill, after “tumultuous negotiations,” looks a whole lot like “the broad outline that Obama had painted more than a month ago.” He comments: “It’s a good point. [T]he administration, a month ago, envisioned a $775 billion plan, with $300 billion in tax cuts. The finished product looks pretty similar.”

He concludes that while “the package should be more aggressive and more ambitious,” it’s still, as a TPM reader put it, an “astonishing … legislative achievement, coming so early in the term.”

Chris Bowers, generally one of the most critical voices, is pithy: “The deal isn’t perfect, but it is still probably the best piece of legislation to pass Congress in, oh, 15 or 16 years.” You should just make sure that it’s just “a starting point from which our legislative and political prospects only improve.”

Neil Sinhababu at Donkeylicious happily says “Good work, House leadership”, remarking that “Isakson’s idiotic $15K tax break per house for home-flippers is gone, and a bunch of the aid to states is back.” Moreover, Stephen Suh at Cogitamus, whose opinion I was particularly interested in because he’s been very vigilant in his criticism of Democratic sell-outs, is satisfied, calling it “a much better bill than anyone thought could come out of the reconciliation process”.

Not everyone is as equinimous, though. Noam Scheiber is outright disappointed: the “only real improvement” on the Senate bill ” is the rollback of the wasteful car and home-buying tax credit”. Otherwise the package is “insufficient”:

Okay, I was wrong–I’ll be the first to admit it. The conference committee didn’t end up moving nearly as far toward the House version of the stimulus bill as I thought it would. The compromise, from what we know of it, looks much more like the substantively inferior Senate version: the cuts to state aid and school construction and COBRA subsidies more or less stand. So does the $70 billion Alternative Minimum Tax relief measure, which may be a perfectly fine idea, but isn’t stimulus under any reasonable definition of the term. This is disappointing, to say the least.

“I am not happy with it [..] You are not looking at a happy camper. I mean they took a lot of stuff out of education. They took it out of health, school construction and they put it more into tax issues.”

Mr. Harkin said he was particularly frustrated by the money being spent on fixing the alternative minimum tax. “It’s about 9 percent of the whole bill,” he said, “Why is it in there? It has nothing to do with stimulus. It has nothing to do with recovery.”

Nothing from Ezra Klein or Kevin Drum yet, the two bloggers I quote way too often here, just because somehow it often feels like they’re my long-lost, smarter, more brilliant, skilful and ambitious twin brothers or something. Normally they write what I wish I would have written, so if they turn out to be scathing about the end result, I’ll be second-guessing myself. We’ll see.

To help you make up your own mind, AP has the new, unified bill’s highlights. The Library of Congress has all the prior info on the bill, but does not seem to have info on the conference committee compromise yet. Since Congressional votes are expected within days, I’m sure the final, full text will be available soon.

UPDATE:

Matt Yglesias is ambivalently positive: “Still, the Senate bill was a lot better than nothing and the conference report is better than the Senate bill, largely thanks to Nancy Pelosi who continues to be the most underrated progressive leader in America [..]. Still, despite Pelosi’s best efforts a lot of good stimulative ideas were left out of this package and a lot of the topline dollar figure has been dedicated to an AMT patch that’s useless as stimulus. The administration and the House Democrats still know what these good ideas are, [..] and I think it’s important that they find ways to work some of those ideas into the regular budget process.”

The passage of the legislation is heartening, but the specifics of the compromise are depressing. So too was the demonstrated power of the centrists and the effortless unity of Republican opposition. The process did not bode well for more controversial priorities like health care and cap-and-trade.

Perhaps most galling was the shell game of the AMT patch. $70 billion for an upper class tax break. [..] And this one provision comprised almost a tenth of the bill. [..]

It was a mixed bill that was constructed in a disappointing way. The left bought into the theory of stimulus spending, which included speed, and many hoped that the spending side would be built to accomplish an array of long-term priorities in areas like transit. That proved, if not wrong, then not right, either. The final bill included a lot of spending — most of it genuine stimulus — but much of it was very different from the sort of spending that the left wanted. If you think of the stimulus bill as having had two questions — how much spending, and what sort — I’d say that liberals should feel good about the first and ambivalent about the second.

So the Conference Committee of Senate and House honchos has reached a deal: U.S. Lawmakers Agree on $789 Billion Stimulus Plan (Update4). The $789 billion price tag means that the bill is indeed smaller than either the House or Senate bill – but at first blush the outcome doesn’t look bad (at least not to my distinctly layman ears).

It’s a little distasteful to see the centrists strut themselves on the bill in the most sanctimonious way:

“It is a jobs bill,” said Democratic Senator Ben Nelson of Nebraska, an architect of the compromise. “And today you might call us the jobs squad.” Nelson and several other senators had insisted that the stimulus plan total less than $800 billion.

Think about this for a second – he prides himself on having cut stuff from the plan – stuff, obviously, that would have created jobs – and even as he touts this dubious achievement, he frames it as having created “a jobs bill,” actually praising himself as part of “the jobs squad”. Never mind that, if it hadn’t been for the vanity tour of his crew, it would have been more of a jobs bill. The chutzpah these people demonstrate, as Matt Yglesias already laid bare earlier, is truly a piece of work.

But all of that is transient. What’s important is the actual bill. And there seems to be a fair bit of good news about this latest revision, going on the Bloomberg update now. At least if you judge the bill by the criteria of liberal criticism this past month – which I am admittedly reduced to somewhat since I have little economic schooling of my own. (So do chime in!)

All in all, about 35% of the plan has ended up as tax cuts and the remainder as government spending. Just to take a step back from the fray: considering just how much tax cuts have been regarded as the holy grail by every administration since Reagan’s, and extra government spending has been widely framed as almost a bad thing in principle, that’s not bad.

Tax cuts

The tax cuts seem overall revised in the right direction. For example, the biggest tax cut that had been included for businesses, which would have let companies convert losses into tax refunds, has been “all but eliminated”. This was a measure that had been criticized as yielding little immediate stimulus and doing little to help the people most in need – Dean Baker of the Center for Economic Progress called it “simply a give-away to the financial industry and homebuilders,” which “has nothing to do with stimulus” and wouldn’t “even be considered if it were not for the political power of the financial industry.”

A proposed $15,000 tax credit for homebuyers was reduced to $8,000. Funding for the plan to let car buyers take a tax write-off on their interest payments has been slashed from $11 billion to $2 billion. These, too, were ideas I’ve seen criticized by liberal pundits. The auto measure would have had little immediate stimulus effect, because it would have primarily resulted in the auto industry emptying the current vast stocks of unsold cars and using the profit to plug debts – all things that would be good, but wouldn’t create new jobs. The tax credit for homebuyers, at this point in the housing market, would be like carrying water to the sea.

On the other hand, Obama’s proposed payroll tax credit has mostly survived, reduced from $500 for individuals and $1,000 for families to will be $400 and $800 respectively.

Can’t have it all though – the plan still includes an Alternative Minimum Tax patch, which, if I’m reading his chart right, ranks very poorly in terms of stimulus impact according to James Galbraith.

Spending

As for the actual spending, there’s these tidbits:

Nancy Pelosi “said she was reassured by Reid that some of the money Democrats in her chamber sought for school construction were included as part of a stabilization fund for states”. That fund will apparently total $54 billion.

There’s “$59 billion in aid for unemployed workers in families, including $27 billion to extend unemployment benefits for 20 additional weeks in most states and 33 additional weeks in states with high unemployment rates”.
Note that the Progressive Caucus in the House was already very proud of having gotten “at least $12.7 billion” in the stimulus bill the House passed to extend unemployment benefits – so that means that this end result is actually even better, right?

It “also increases weekly [unemployment] benefits by $25.”

The bill “expands a federal subsidy to help jobless workers keep their health benefits by paying 60 percent of their premiums for nine months for married couples who earn under $250,000.”
Judging on this side-by-side overview of the differences between the House and Senate bills, this seems to have been one of the House bill’s provisions that the Senate centrists had scrapped in theirs.

It “authorizes a one-time $250 payment for senior citizens, disabled veterans and disabled people living on Social Security benefits.”
Judging on the above-linked overview, that looks like a more generous scope than the House bill’s, in which only Social Security beneficiaries would have received it.

It provides $90 billion for federal funds for Medicaid and $19 billion to facilitate the digitization of health records.

All sounds like good stuff that will immediately aid those hardest hit by the crisis, as well as nicely reverse the trend of the last decade or two to squeeze the benefits for the poorest ever further.